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Guidance for closing subcodes prior to parent WBSE

In the event the portion of a project supported by a subcode is completed prior to the parent end date, the department can request the subcode be closed early. Closing the subcode early eliminates the risk of erroneous ledger activity and, if permitted by terms and conditions of award, may allow funds to support other project activities. 

Closeout & sponsor due dates are, in most cases, based on the parent end & due dates. Standard closeout process closes subcodes at the same time as the parent WBSE. If an exception to this process is needed, specific steps and information will be necessary to navigate existing procedures.

Specific situations require additional analysis or steps. 

Assessing need and impact of closing a subcode early

Before closing a subcode prior to parent, departments should consider the impact on the overall project. Considerations and risk vary depending if subcode is internal or external to Duke.

Factors to consider when closing subcodes early

All types of subcodesInternal subcode specificExternal subcode specific
What is the benefit of closing the subcode prior to the parent? Are future activities planned that will need support?

Determine if external sub agreement needs modification or deobligation*

 

Has all project work been completed?Who is responsible for submission of closeout docs?Does the PI have all reports and project deliverables?
Are all expenses posted to WBSE? Is the final invoice posted?

How will the balance be managed if closed prior to parent?  

Balance Netting process is not applied when a subcode closes prior to the parent.

  

*If a modification is not executed to deobligate any unspent plan, the department assumes financial responsibility for any debits posted to the subcode once the Closeout Tasklist has been submitted. 

Management of balances during closeout of the subcode closing prior to parent

Unobligated/Residual Balances
PAFM will allocate unspent plan (directs and indirects) to the parent WBSE using the GL 99600. 

Cost Overrun Balances
WBSE expenses greater than the plan amount result in the unit being required to absorb costs beyond the allocated budget. The overrun amount will be transferred to the backstop code assigned in SAP. 
 

External Subrecipient Plan & Balance

Submission of closeout documents to close a subcode prior to parent does not relinquish Duke from financial responsibility of a fully executed subrecipient agreement.

Process for Closing a Subcode Early

Required closeout documents should be submitted by the department in compliance with institutional closeout guidelines. In addition, specific information and steps will be needed to close a subcode prior to the parent. Outlined below are expectations by responsible area and role.
Department/unit

The Grant Manager(s) and PI(s) for both the parent and subcode should agree on the need to close subcode prior to parent. The owning org of the WBSE is responsible for closeout submission unless the units involved have other agreements on management of the closeout. 

Grant Manager responsibilities:

  • If subcode end date is >90 days in future, work with CAMT or ORA-Post Award to update the WBSE end date.
    • If external subcode, a modification will be necessary to change the end date.
  • Verify a modification to deobligate unspent plan is not needed
    • Consult appropriate Preaward Office (ORA/ORC/ORS) to determine if modification is necessary.
    • If modification is not deemed necessary or appropriate, consider obtaining confirmation from external sub, in writing, that all funds originally allocated in subaward agreement will not be spent. Attach this to the Closeout Tasklist to be imaged as part of the institutional closeout record.
  • Confirm all debits and credits are posted to WBSE
    • Final Invoice must be posted in SAP for any external subcode being closed prior to the parent. 
    • NOTE: This does not apply to revenue. Revenue will be redistributed between the parent and subcode by PAFM as part of the closeout process, if applicable. No action is needed by dept for this to occur.
  • Resolve plan amount in GL 99650
  • Understand how balance will be handled during closeout
  • Include a comment in the Closeout Tasklist and PI Attestation stating that you are requesting this subcode be closed prior to parent. 
    • With this comment, the department acknowledges that this is an exception to the standard closeout process and that no additional expenses are expected.
    • Due to system workflow set up, if this comment is not included the request for special handling will not occur resulting in the subcode closing with parent.
  • Once subcode is closed in SAP, review impact of balance and adjust if necessary. 
    • If subcode has unspent plan (and allowable based on Rebudget Class), PAFM moves the direct and indirect balance to the parent WBSE into GL 99600. The GM or responsible unit may rebudget this plan into other expense categories or codes based on allowability and project needs. 

Departmental Approver of the Closeout Tasklist responsibilities:

  • Verify the final invoice, or treat as final, invoice is posted in SAP
  • Confirm comment is included acknowledging this code needs to be closed prior to the parent
  • Understand impact to closing subcode prior to parent, including possible financial risk if additional expenses or invoices are received and approved for payment related to the subcode agreement.

PI responsibilities:

  • Review and approve PI Attestation, acknowledging the closing of this sub prior to the overall project.
CAMT/ORA-Post Award

Follow the standard closeout review and approval guidelines. In addition, the central closeout reviewer will:

  • Verify the final invoice, or treat as final, invoice is posted in SAP
  • Review comment requesting subcode be closed prior to parent.
  • Once Tasklist with comment requesting manual closeout workflow is approved, email PAFM liaisons with request to close the subcode prior to parent.
PAFM

Follow the standard closing process. In addition, PAFM will:

  • Verify the final invoice, or treat as final, invoice is posted in SAP
  • Manage balance on subcode based on assessment in Management of balances during closeout of the subcode closing prior to parent section above
    • If composite code exists, PAFM will reach out to GM1 associated with parent WBSE to discuss management of unobligated balance reported on the Closeout Tasklist.

PAFM’s workload is driven by sponsor due date & parent WBSE, sponsor deadlines are prioritized.

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